Small- and medium-sized enterprises (SMEs) will find it easier and faster to get loans with the launch of a central database that collects credit-related information.
SME Credit Bureau which was launched yesterday aims to make the credit history of the companies more transparent and thus increase the willingness of financial institutions to lend to them.
The bureau is a collaborative effort between Infocredit D&B and the Association of Small and Medium-sized Enterprises.
According to Lawrence Leow, the association's president, banks are still apprehensive about lending to new businesses. „One reason for this is the lack of information, in particular financial track records, for new start-ups and smaller businesses,“ Mr Leow said.
The institutional reluctance is linked to higher risks associated with lending to start-ups and smaller businesses, especially in the absence of established ways of gauging the creditworthiness of a business owner.
